What Is It?
In British Columbia, strata corporations (condominiums) are governed by the Strata Property Act (SPA). Before buying a strata unit, prospective buyers are entitled to request a Form B: Information Certificate from the strata corporation, which discloses the unit’s strata fee amount, any arrears, pending special levies, and bylaw restrictions — along with access to the corporation’s financial records, meeting minutes, and depreciation report.
A poorly funded strata reserve can result in special levies — one-time charges to all owners to fund major repairs. These levies can be tens of thousands of dollars per unit and become the buyer’s obligation after closing. Understanding the strata’s financial health before purchasing is critical.
The Form B — Your Right to Information
Any person may request a Form B from a strata corporation for a fee of up to $35 (the current cap under the SPA regulations). The strata must respond within 7 days.
The Form B discloses:
- Monthly strata fees for the specific unit
- Any arrears of strata fees owed by the current owner
- Any money owing to the strata by the owner
- Any special levies currently approved but not yet collected
- Any encumbrances registered against the strata lot
- Any notices or orders affecting the strata
The Form B also provides access to:
- Current budget and most recent audited financial statements
- Reserve fund balance
- Most recent depreciation report
- Current bylaws and rules
- Minutes of annual and special general meetings (past 2 years)
Understanding the Depreciation Report
Under the Strata Property Act, most strata corporations with 5 or more units must have a depreciation report prepared by a qualified professional every 3 years. The report:
- Inventories all common property and limited common property
- Estimates the useful life remaining for each component (roof, windows, elevator, pipes, etc.)
- Projects future repair/replacement costs
- Models funding scenarios to ensure the reserve fund has sufficient funds
What to look for in a depreciation report:
- Is the reserve fund funded at or above the recommended level in all scenarios?
- Are any major components due for replacement within 5 years?
- Has the strata been contributing the recommended monthly amounts to the reserve fund?
Red Flags That Indicate Financial Risk
- Reserve fund balance significantly below the depreciation report recommendations
- Special levy approved at the last AGM (you may be buying into an obligation)
- Meeting minutes showing deferred maintenance or contentious bylaw disputes
- Aged depreciation report (more than 3 years old without a new one commissioned)
- No depreciation report at all (strata may have waived the requirement by 3/4 vote)
- Strata fees substantially lower than comparable buildings (may indicate underfunding)
What Most People Don’t Know
- Stratas can vote to waive the depreciation report requirement by 3/4 vote. A strata without a depreciation report is a red flag — it means owners voted against transparency. Some stratas do this to avoid disclosing the true cost of deferred maintenance.
- The Form B has a 60-day validity period. The financial information is accurate as of the date issued. For a lengthy purchase process, get a fresh Form B close to completion.
- You can review 2 years of meeting minutes. Meeting minutes are your window into the strata’s management quality — disputes, noise complaints, major repairs, deferred maintenance, and budget debates all appear in minutes. Review them carefully.
- Special levies approved before you buy are your obligation. If a special levy was approved at an AGM that occurred before your closing date, you are buying into that financial obligation (unless negotiated otherwise). Check the Form B and minutes carefully.
Frequently Asked Questions
The depreciation report shows the reserve fund is $150,000 short of the recommended balance. How do I evaluate this risk?
Calculate the per-unit shortfall (divide by number of units). Assess whether the shortfall is for near-term or long-term needs. Review the funding scenarios in the report — if the strata increases monthly contributions gradually, the shortfall may resolve without a special levy. If a major expense is due within 3 years and the reserve is short, budget for a special levy.
Can I make my purchase offer conditional on satisfactory review of the strata documents?
Yes — this is standard practice in BC. Include a subject condition allowing you 7–10 days to review the Form B, depreciation report, financial statements, and meeting minutes, with the right to waive or remove the condition based on your review.
The strata doesn’t have a depreciation report — they waived it. What should I do?
Be cautious. Ask the strata manager or president why the report was waived. Request any older reports, visual inspection reports, or capital planning documents. Consider hiring a building inspector who specializes in strata to do a condition assessment before completing the purchase.
I already bought the unit and discovered a previously undisclosed special levy. Can I sue?
If the seller or strata corporation knew about an approved special levy and failed to disclose it in the Form B or otherwise, you may have a misrepresentation claim against the seller. Consult a real estate lawyer immediately.